Japan’s exporters need all the help they can get – 25 years of stagnation have taken their toll. So a drive to push down the value of the yen, making it easier to export, can be expected to raise a cheer in the sake bars of Kyoto.

But the key to understanding the latest move is the need to maintain an already depressed currency. This is because big business in Japan will not invest in extra production without the assurance that the yen will be low for at least the rest of the business cycle, which they hope could be another five years. Japan is an export junkie that needs the rest of the world to buy much more of the stuff it makes at home than they will ever buy from abroad.

The deposit charge works by acting as a disincentive for international investors to park their money in Tokyo. With fewer funds coming into the country, the demand for yen falls and so does the value of the currency, especially in relation to the all-important dollar.

It was important for the Bank of Japan to shift up a gear for four reasons. The first relates to the China crisis and the fall in the value of the yuan. Japan is increasingly finding that China is a direct competitor in the East Asia region for contracts and major orders. It recently suffered a morale-sapping shock when it lost a high-speed rail contract in Indonesia won by the newly created Chinese national railway company.

The dumping of Chinese steel and other manufactured products has acted as another incentive. It depresses prices again when inflation was only just recovering. The Bank of Japan, like all the major central banks, has a target of 2% stable inflation. Officials forecast last year that prices would rise by 1.4% in 2016. The latest forecast has been cut to 0.8%.

Thirdly, the turmoil in world markets in response to the China slowdown has again turned Japan into a safe haven for international funds. Since last September, when Beijing hit trouble and the Shanghai stock market panicked, cash has poured into Tokyo. The yen, already under pressure, started to climb.

The final straw was the threat from Mario Draghi, the boss of the European Central Bank, that he will cut his deposit rate again in March after already starting down that road last year.

Tokyo is pumping almost £50bn a month into the Japanese economy by buying government bonds under a quantitative easing programme. Draghi is doing the same. With this in mind, it was clear that without a decisive move to maintain parity, a further rise in the yen was inevitable.

And it’s had the desired effect. From 117 yen to the dollar a week ago, traders must now spend 120 yen to buy a dollar.

In some ways, it was a wonder the 5/4 vote in favour of a negative deposit rate was so close.

Prime minister Shinzo Abe lost his economy minister on Thursday to a bribery scandal. But that setback cannot be allowed to undermine his compact with big business – if he keeps the yen low, they agree to boost investment, exports and employment. As they all know, only then can Japan’s inflation have a hope of reaching the target.